Study blames speculation for oil's rise
- Thread starter LadyT
- Start date
actually I called that a red herring.
You were giving us classic SF strawman's earlier.
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The Almighty
Despite the attempted double team by you two clowns... I think any reader that understands the markets will determine conclusively that I am 100% correct.
You want to change the price of commodities, change the fundamentals of the supply/demand equation or strengthen the dollar. Don't regulate to try to 'punish' investors who are trying to protect their portfolios from inflation caused by higher energy/commodity prices.
you didn't prove anything other than that the author was right. You never quantified exactly how much of the $50+ hike was due to everything else other than speculation.
cawacko
Well-known member
Where is Topspin when we need him to compliment our two lady friends on their lack on market understanding?
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The Almighty
Sorry, I forgot you librual gals have a hard time with the maths and sciences.
The dollar fluctuation accounted for about 15-20% of the upswing in price. It was similar on the downside. Demand increased faster than supply early in the year, but there is no way to quantify just how much of the increase was due to that vs. speculation ON that. So lets be conservative and say that everything beyone the dollar effect was due to speculation on both sides of the trade.
Again, this is pretty much a moot point. It doesn't matter. What MATTERS is what drove the speculators from being bullish to bearish on the price of oil. THAT is the quickest way to get the price moving in the direction you want. Provide the speculators with a reason to do so. A point you continue to ignore.
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The Almighty
the author is correct in saying that cash flow went in early in the year and came out around the end of July. But that tells you exactly what? Other than showing you the obvious correlation of cash flow and price movement it tells you NOTHING. It doesn't explain at all WHY cash flow shifted.
Trying to paint speculators as bad for the market is idiotic. As I stated and you continue to ignore.... speculation takes place in every single stock, bond, commodity, home, car etc... that we buy. Speculation is NOT the problem.
Kamala Trump
Verified User
what's idiotic is allowing people able who can effect the fundamentals through law to also be investors.
Topspin
Verified User
Topspin
Verified User
there is no exact quantifying any products price but what customers are willing to pay. ditz
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The Almighty
A report that blames speculators for what happened to the price of oil. Which is idiotic. AGAIN... when people invest their money they are ALWAYS speculating. It is an inherent part of the market. When people think an investment is going to go up in the future, they buy it. When they think it is going to go down they sell it. If the amount of cash on the buy side exceeds that on the sell side, the price goes up. If the expectations are large enough, the security could be driven to a price that is above its current fair market value. The reverse also holds true.
To blame speculators for investing based on market conditions is idiotic.
To point to cash flow and proclaim "by golly this is what caused it" is idiotic... because that is the cause for EVERYTHING going up or down. IT is ALWAYS the case.
To determine the CAUSE of prices going up you have to look at what is CAUSING them to do so.... in the case of oil it is going to be the four I mentioned a long ass time ago. The ONLY way you get prices to move in the direction you want is to change the perception of future value.
Trying to limit 'speculators' is not going to change the price of a commodity. They are still going to continue buying more oil if they think the future price will be higher than it is today.
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The Almighty
"We have clear evidence the fund flow pushed prices up and the fund flow pushed prices down," said Michael Masters of Masters Capital Management, calling the amount of money moving into oil futures markets by large institutional investors in the early part of the year "way off the scale."
Masters said its analysis shows investors "began a massive stampede for the exits" on July 15 and that this caused the price decline.
"These large financial players have become the primary source of the dramatic and damaging volatility seen in oil prices," concluded the report."
He is clearly blaming 'cash flow' for the increase in prices. As are the Dems in that article. Because it fits their AGENDA. It completely ignores the factors that caused money to shift both in and out of oil.
Masters said its analysis shows investors "began a massive stampede for the exits" on July 15 and that this caused the price decline.
"These large financial players have become the primary source of the dramatic and damaging volatility seen in oil prices," concluded the report."
He is clearly blaming 'cash flow' for the increase in prices. As are the Dems in that article. Because it fits their AGENDA. It completely ignores the factors that caused money to shift both in and out of oil.